Editor's note: This is the second part of a series examining the government's "Making Home Affordable" program and the struggles of homeowners seeking a mortgage-rate modification. Check back Friday for the third installment.
NEW YORK (TheStreet) -- While banks and regulators have frittered away precious time, others have sensed opportunity in the rubble of the housing market.
Call them savvy entrepreneurs or shady wheelers-and-dealers, but small mortgage-workout shops have sprouted up across the country like wildfire, promising to deliver results in a speedy fashion. They often have names that evoke a mix of strength, expertise and patriotism: Amerisave Mortgage Corp., Bank Modification Experts, American Home Relief, US Loan Relief or, simply, ObamaHousingPlan.net.
It's difficult for the average consumer to tell which companies are legitimate. The firms tend to use marketing lingo that paints them as helpful, non-profit consumer agencies, or associates them with the president's housing program.
For example, www.2009obamahomereliefplan.com is decked out in red, white and blue, with a video of President Obama at the top of the site. In a press release with a Washington dateline it promotes "Refinements to Existing Administration Programs Designed to Help Unemployed, Underwater Borrowers While Helping Administration Meet its Goals." It offers "drastic rate reductions," "elimination of fees and penalties" and the ability to "stop foreclosures immediately" through a 24-hour hotline.
Yet the site isn't directly associated with the federal government or its housing programs. Nor does it actually modify mortgages or stop foreclosures. It also presents inaccurate information, telling visitors that only first mortgages are eligible, when the administration has been prodding banks to participate in the second-lien workout program as well.
See our interactive map of foreclosures by state.